- When a health insurance is provided through the legal route, there are obvious advantages for patients. The government also becomes more accountable.A case for legalising Modicare:
Originally published here.
“The National Health Protection Scheme will cover over 10 crore poor families. This will be the world’s largest government funded healthcare programme.” – Finance Minister Arun Jaitley
When Jaitley said this in his Union budget speech 2018-19, the statement was received with a mix of scepticism and joy. Sceptics noticed that similar announcements made in the past failed because of a lack of funding and absorption capacity. The National Health Protection Scheme (NHPS), or Modicare, was announced in last year’s budget as well.
However, currently, it is being run as Rashtriya Swasthya Bima Yojana (RSBY). The scheme is part of the Ayushman Bharat programme, which includes primary and secondary care provisioning through designated wellness centres.
Neither Ayushman Bharat nor Modicare is backed by law. Even though RSBY finds mention in Schedule 1 of the Unorganised Workers Social Security Act, 2008, it works through a yearly contract with an insurer, who executes the scheme as per government specifications. There is a lack of accountability and due process in the existing RSBY scheme, making it impossible to understand its achievements or pitfalls. However, this scheme is one of the many health insurance schemes of the government. As an example, The Employees State Insurance Scheme, one of the oldest schemes for workers in the organised sector in the country, functions through The Employees’ State Insurance Act, 1948 (ESI Act).
To grow the RSBY scheme even further as anticipated in the current budget, it would be prudent to consider having it under a legal regime for the following reasons:
A clear definition of RSBY objectives
As legislation, a statement of its objectives would define the benefits available, or those that are being aspired to, be made available to patients. Currently, the RSBY website contains the following object statement, which seems to be outdated:
In India more than two thirds of expenditure on health is through Out of Pocket (OOP) which is the most ineficient and least accountable way of spending on health. Supply side financing on health alone has not been found to be successful in reducing OOP expenditure on health substantially and therefore, to test the demand side financing approach, Government of India, decided to introduce Rashtriya Swasthya Bima Yojana (RSBY) a Health Insurance Scheme for the Below Poverty Line families with the objectives to reduce OOP expenditure on health and increase access to health care. (Emphasis added)
Permanent administrative authority
An administrative authority is responsible for implementing a scheme. It is a perpetual entity and the form of selection of officers, their terms as well as functions are defined. Creation of this authority by law would make RSBY transparent and accountable.
The RSBY is currently being managed by a team of four bureaucrats in the Ministry of Health and Family Welfare. The members are not full-time because they are in charge of additional segments like medical tourism and national AIDS control programme, among others. They are assisted by three consultants. This leads to three problems:
- Multi-tasking members,
- There is no requirements for meetings, terms, etc, making RSBY a non-priority;
- No scrutiny as there is no requirement for providing annual reports, etc.
Management of finance and internal audit
Legislation usually defines the flow of money. It also provides transparency in accounts through annual reports and calls for parliamentary or government scrutiny.
As an example, under the ESI Act, the funds are parked with the corporation. The purpose for which the funds can be expended are clearly mentioned in Section 28. The corporation can hold property and invest funds. It is compulsory for it to make an estimated budget annually, approved by the central government. The budget, an annual report of expenditure and accounts, is laid down before Parliament. Every three years, the corporation submits a valuation report of its assets to the central government.
The ESI Act has a clear advantage because of its legal structure. It generated Rs 16,852.38 crore and spent Rs 9,727.71 crore in 2016-17. At the same time, the budget for RSBY was Rs 1,000 crore, but it spent Rs 470 crore. The population covered by RSBY in this period was 3.63 crore, while ESI covered 3.19 crore individuals.
Benefits to patients
Benefits in health insurance are provided in the form of fixed packages for the patients. In RSBY, they are medical benefits limited to procedures requiring hospitalisation and not the routine outpatient care. This includes diagnosis, hospitalisation, medicine, and pre-decided procedures at package rates decided between the hospitals and insurance agency.
Because the scheme is implemented only through a yearly tender with an insurer, the government can unilaterally change its benefits available to the patients. This makes the scheme inconsistent and unreliable for the beneficiaries as they do not have any legal standing.
Adjudication of disputes and claims
One of the repercussions of a large scheme is disputes arising out of transactions. Dispute resolution must be an independent, transparent, and quick process. The authority responsible as well as the jurisdiction and powers are defined in typical legislation.
RSBY consists of a three-tier adjudication mechanism. There are three sets of grievance redressal committees – district, state, and national. The membership for these committees and timelines for adjudication are provided in tender. However, there is no explanation on the process to be adopted and powers of these committees. In contrast, under the ESI Act, the state government has to form “Employees’ Insurance Court” for a local area, which has the power of a civil court to issue summons, discovery, and demand evidence. The Act lays down the jurisdiction, power as well as the procedural aspects of this court.
In a healthcare scheme, both civil and criminal issues can arise at multiple levels. There is no mention of penalties in the RSBY website. But the tender document states that RSBY can penalise the insurance company selected by it for under-performance. The hospitals under the scheme can be disbarred if reported to the grievance redressal commission. This leaves out many issues, which can be faced by patients to be dealt between either the hospital and patient or the insurer and patient. Such a situation makes the scheme cumbersome for the beneficiaries.
Even after a decade of implementation of RSBY, no efforts have been made as yet to provide healthcare to patients through law rather than yearly contracts with insurers. When a health insurance is provided through the legal route, there are obvious advantages for patients. The government becomes more accountable and the tax money is not utilised in an ad hoc manner. This route might help plug gaps which lead to under-utilisation or mis-utilisation of government funds as well. Overall, a legal status would help all stakeholders become more confident of the scheme.
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